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Friday Footnotes: A CPA Grindset We Can Get Behind; The Klynveld Krypto Team; Firms Still Desperate (For People) | 6.24.22

a white cat and a fan of money

Accounting Firm EY Grapples With Partner Pay, Bear Market in Breakup [Wall Street Journal] Ernst & Young’s leaders, trying to persuade partners to split up the firm, said windfalls would be spread evenly, but a bear market threatens to cut the value of a potential initial public offering of its consulting business, according to an internal webcast and people familiar with the matter. Speaking to EY’s roughly 13,000 partners Monday, Global Chairman and Chief Executive Carmine Di Sibio said that the firm would give all partners in a country the same multiple of pay, according to a recording of the webcast reviewed by The Wall Street Journal.

EY consulting partners face 40pc pay cut in split [Australian Financial Review] EY’s consulting partners have been told they would have their cash pay cut by up to 40 per cent to reduce costs if they split off into a standalone company, according to a report in The Wall Street Journal. The firm’s consulting partners would receive shares worth as much as seven to nine times annual income, estimated by the Financial Times to be worth as much as $US8 million ($11.6 million).

Institutions are exploring the space — KPMG Canada crypto team [Cointelegraph] The Canadian operations of Big Four auditor Klynveld Peat Marwick Goerdeler, or KPMG, may have a role to play in institutions entering the crypto space, according to two team members. Speaking to Cointelegraph at the Collision conference in Toronto on Tuesday, Kareem Sadek and Kunal Bhasin of KPMG Canada’s crypto assets and blockchain services team said the company had added Bitcoin (BTC) and Ether (ETH) to its balance sheet to show others it “had skin in the game.” According to Sadek, holding digital assets was just the first step moving deeper into the crypto space.

PwC’s Tim Ryan on the 3 traits C-suite leaders need right now [Fortune] “The job of an executive, I’m not just going to say CEO, has dramatically changed over the last few years,” Tim Ryan, U.S. chair and senior partner at PwC, told me. “We don’t think that’s temporary.” The change will continue over time, Ryan says. “The skill sets, the experiences, the approach needed in the C-suite today is very different,” he says.

FASB preps to revamp ‘outdated’ accounting for software [CFO Dive] “The models are outdated,” FASB member Gary Buesser said at the meeting, lending his support to the project and commending the staff for its work. “You guys have clearly done a great job identifying accounting that is way beyond its date…to do nothing about this would be a shame.”

UPS, Dell, Others Call on SEC to Retool Climate Accounting Plan [Bloomberg Tax] Audit firms and companies including United Parcel Service Inc. and BNP Paribas SA urged the SEC to revamp onerous climate accounting requirements as the regulator considers a major expansion of corporate reporting.

Firms step up recruiting amid talent shortage [Accounting Today] Accounting firms are trying to entice more young people to join the accounting profession as the number of open positions grows during the Great Resignation and a wave of retirements.

Over on Reddit, u/Ostinato6 is cranking out a CPA Grindset series:

And then there’s this. I swear we’ve heard this somewhere before…

AICPA publishes Q&A to explain SEC guidance on cryptoassets [Journal of Accountancy] The AICPA has published a set of questions and answers that explains recently released SEC staff guidance regarding the accounting for entities that have obligations to safeguard cryptoassets held for their platform users. In response to the issuance of Staff Accounting Bulletin No. 121 (SAB No. 121), the Q&As have been placed in Appendix B of the practice aid, Accounting for and Auditing of Digital Assets.

Use of forensic accounting growing [Mississippi Business Journal] Long time Jackson forensic accountant Glover (Russ) Russell, who has a law degree and a master’s in tax law in addition to an accounting degree, observes that the use of forensic accounting has increased in the past 10 years. “I think it’s because people want money and are more materialistic; money means more to people now and a lot get into financial binds,” he said. “It may start small or maybe they think it’s something they’re entitled to, but it catches up.”

‘My heritage has deeply influenced my career’ [CPA Canada] Three Indigenous CPAs share their career insights, the fulfillment they experience working within their communities and the impact of the designation

People who are always looking to the Universe for a sign should take this tweet we came across this week as a very, very strong one:

Planning Your Diversity & Inclusion Strategy? Take Note Of Deloitte’s High-Impact Lessons [Forbes] At its launch, the MADE initiative aimed to combine both financial support, and the depth of resources an organization of Deloitte’s size can bring to attract diverse individuals into the accounting field. “The representation of racially and ethnically diverse CPAs in our profession is unacceptably low and bringing these voices to the conversation requires decisive, bold investments.” Lara Abrash, CEO of Deloitte’s US Audit & Assurance business said last year at the launch of the program. Since then, there has been significant progress.

And one last thing for firm leaders reading this: ConvergenceCoaching has opened their 2022 Anytime, Anywhere Work™ (ATAWW) Survey, the survey seeks input on remote and flexible work practices in accounting and consulting firms across the country. ConvergenceCoaching is offering participants the summary results along with best practices and strategies to implement these programs and maintain a competitive advantage. They’re requesting only one entry per firm, so be sure you coordinate with other leaders in your organization (usually the HR leader or Managing Partner). Here is the link to participate. The survey is open through July 15th.